UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K ፤ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2004 SIMON PROPERTY GROUP, L.P. (Exact name of registrant as specified in its charter) Delaware (State of incorporation or organization) 33-11491 (Commission File No.) 34-1755769 (I.R.S. Employer Identification No.) National City Center 115 West Washington Street, Suite 15 East Indianapolis, Indiana 46204 (Address of principal executive offices) (317) 636-1600 (Registrant’s telephone number, including area code) Securities registered pursuant to Section 12 (b) of the Act: None Securities registered pursuant to Section 12 (g) of the Act: None Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES ፤ NO អ Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of Registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. N/A Indicate by check mark whether Registrant is an accelerated filer (as defined by Rule 12b-2 of the Securities Exchange Act of 1934). YES អ NO ፤ Registrant had no publicly-traded voting equity as of June 30, 2004. Registrant has no common stock outstanding. Documents Incorporated By Reference Portions of Simon Property Group, Inc.’s Proxy Statement in connection with its 2004 Annual Meeting of Stockholders are incorporated by reference in Part III. Simon Property Group, L.P. and Subsidiaries Annual Report on Form 10-K December 31, 2004 TABLE OF CONTENTS Item No. Page No. Part I 1. Business .......................................................... 3 2. Properties ......................................................... 12 3. Legal Proceedings .................................................... 42 4. Submission of Matters to a Vote of Security Holders ............................ 42 Part II 5. Market for the Registrant’s Common Equity and Related Stockholder Matters ........... 43 6. Selected Financial Data ................................................ 44 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations . 45 7A. Quantitative and Qualitative Disclosure About Market Risk ....................... 63 8. Financial Statements and Supplementary Data ................................ 64 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure . 64 9A. Controls and Procedures ............................................... 64 9B. Other Information .................................................... 65 Part III 10. Directors and Executive Officers of the Registrant .............................. 66 11. Executive Compensation ............................................... 66 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters ........................................................... 66 13. Certain Relationships and Related Transactions ................................ 66 14. Principal Accountant Fees and Services ..................................... 66 Part IV 15. Exhibits and Financial Statement Schedules .................................. 67 Signatures ............................................................... 108 2 Part I Item 1. Business Background Simon Property Group, L.P. (the ‘‘Operating Partnership’’) is a Delaware limited partnership and a majority owned subsidiary of Simon Property Group, Inc. (‘‘Simon Property’’). Simon Property is a self-administered and self-managed real estate investment trust (‘‘REIT’’). In this report, the terms ‘‘we’’, ‘‘us’’ and ‘‘our’’ refer to the Operating Partnership and its subsidiaries. We are engaged primarily in the ownership, operation, leasing, management, acquisition, expansion and development of real estate properties. Our real estate properties consist primarily of regional malls, Premium Outlet↧ centers and community shopping centers. As of December 31, 2004, we owned or held an interest in 296 income- producing properties in the United States, which consisted of 171 regional malls, 71 community shopping centers, 31 Premium Outlet centers and 23 other properties in 40 states plus Puerto Rico (collectively, the ‘‘Properties’’, and individually, a ‘‘Property’’). Our other Properties include retail space, office space, and/or hotel components. In addition, we also own interests in twelve parcels of land held in the United States for future development (together with the Properties, the ‘‘Portfolio’’). Finally, we have ownership interests in 51 European shopping centers (located in France, Italy, Poland and Portugal); four Premium Outlet centers in Japan; one Premium Outlet center in Mexico; and one shopping center in Canada. Our wholly-owned subsidiary, M.S. Management Associates, Inc. (the ‘‘Management Company’’), provides leasing, management, and development services to most of the Properties. In addition, insurance subsidiaries of the Management Company insure: the self-insured retention portion of our general liability program; the deductible associated with our workers’ compensation programs; and provide reinsurance for the primary layer of general liability coverage to our third party maintenance providers while performing services under contract with us. Third party insurers provide coverage above the insurance subsidiaries’ limits. Mergers and Acquisitions Mergers and acquisitions have been a significant component of the growth and development of our business. In 2004, we completed a series of acquisitions that added to our overall Portfolio: • On February 5, 2004 we purchased a 95% interest in Gateway Shopping Center in Austin, Texas for approximately $107.0 million. • On April 1, 2004, we increased our ownership interest in Mall of Georgia Crossing from 50% to 100% for approximately $26.3 million, including the assumption of $16.5 million of debt. • On April 27, 2004, we increased our ownership interest in Bangor Mall and Montgomery Mall to approximately 67.6% and 54.4%, respectively, for approximately $67.0 million and the assumption of our $16.8 million share of debt. • On May 4, 2004, we purchased a 100% interest in Plaza Carolina in San Juan, Puerto Rico for approximately $309.0 million. • On October 14, 2004 we completed our acquisition of Chelsea Property Group, Inc. (Chelsea). The acquisition included 32 Premium Outlets in the United States, 4 Premium Outlets in Japan, 3 community centers, 21 other retail centers, and its development portfolio. The purchase price was approximately $5.2 billion including the assumption of our $1.5 billion share of debt. • On November 19, 2004 we increased our ownership interest in Lehigh Valley, located in Whitehall, Pennsylvania, to 37.6% for approximately $42.3 million, including the assumption of our $25.9 million share of debt. • Finally, on December 15, 2004, we increased our ownership interest in Woodland Hills, located in Tulsa, Oklahoma, to approximately 94.5% for approximately $119.5 million, including the assumption of our $39.7 million share of debt. 3 Dispositions As part of our strategic plan to own quality retail real estate, we continually evaluate our properties and sell those which no longer meet our strategic criteria. We may use the capital generated from these dispositions to invest in higher-quality, higher-growth properties. We believe that the sale of these non-core Properties will not have a material impact on our future results of operations or cash flows nor will their sale materially affect our ongoing operations. Generally, any earnings dilution from the sales on our results of operations from these dispositions will be offset by the positive impact of our acquisitions and development and redevelopment activities. During 2004, we sold five non-core Properties, consisting of three regional malls, one community center and one Premium Outlet. The Properties and their dates of sale were: • Hutchinson Mall on June 15, 2004 • Santa Fe Premium Outlets on December 28, 2004 • Bridgeview Court on July 22, 2004 • Heritage Park Mall on December 29, 2004 • Woodville Mall on September 1, 2004 In addition, on April 7, 2004, we sold a joint venture interest in a hotel property held by the Management Company. On April 8, 2004, we sold our joint venture interest in Yards Plaza, in Chicago, Illinois, and on August 6, 2004, we completed the court ordered sale of our joint venture interest in Mall of America, in Minneapolis, Minnesota (see Item 3). The sales of these properties did not result in any significant gain or loss. Operating Policies and Strategies The following is a discussion of our investment policies, financing policies, conflict of interest policies and policies with respect to certain other activities, which are consistent with those of Simon Property, our general partner. The Simon Property Board of Directors may amend or rescind these policies from time to time at its discretion without a stockholder vote. Investment Policies Our primary business objectives are to increase Funds From Operations (‘‘FFO’’) per unit, operating results and the value of our Properties while